Former Bloomberg Intelligence analyst Jamie Coutts thinks the current crypto market parallels the US stock market in the early 1900s.
Coutts, who now works as a freelance blockchain strategist, tells his 9,738 followers on the social media platform X that the comparison means the biggest opportunities in crypto won’t last forever.
“This unique environment offers abundant alpha-generating opportunities unmatched in any other asset class. But this window will exist only for a few years before it is arbitraged away.
At the turn of the century, the US economy was emerging as the global economic superpower, and capital poured in.
The network state/crypto ecosystem today is on the ascendency, and ETFs (exchange-traded funds) will trigger a massive inflow of capital spanning decades.
In the pre-1933 & 1934 Securities Act era, the US stock market operated in a ‘loose’ regulatory environment, was highly fragmented, large whales dominated, and information asymmetry ruled the day. Very much like crypto markets today.”
Coutts also notes that Bitcoin (BTC) is still dominating the current crypto market, but says that a shift towards altcoins “feels imminent.”
“Considering the significant capital flows expected from BTC ETFs next year, maybe it takes longer this cycle. Usually altseason hits within 1-1.5 years from the cycle low which is [around] Q2 2024.
While human behavior remains a constant, with the rotation fueled by BTC profits, FOMO (fear of missing out), and greed, we will see the emergence of some clear long-term winners in this cycle; Alt-Layer-1s, Layer-2s, and DApps (decentralized applications) with product market fit and growing adoption.”
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